Sales of newly built homes surged 55% year-over-year in June—the highest pace of sales growth in homebuilding since the housing boom back in 2005 and 2006, according to new data from John Burns Real Estate Consulting. The firm’s data tends to mirror U.S. Census Bureau reports.
With a limited number of existing homes for sale, homebuilders are finding more buyers turning to them for options. This latest housing boom is being entirely driven by the coronavirus pandemic, CNBC reports.
“The anecdotal evidence is overwhelming,” John Burns, founder and CEO of John Burns Real Estate Consulting, told CNBC. “Sales in the distance commuter areas are the most robust. I believe a lot of computer-oriented people have proven to their co-workers that they can be productive from home, and have sensed, or officially been given the green light, to work from home at least a significant portion of the time after a vaccine has been found.”
Homebuilder Taylor Morrison reported last week a 94% annual jump in its June sales, a record high.
New-home sales are reportedly the strongest in the Northeast, an 86% annual increase, according to John Burns Real Estate Consulting data. Florida is also seeing new-home sales rapidly increasing, up 84% annually.
As demand increases, so do home prices. About 57% of homebuilders surveyed by John Burns Real Estate Consulting said they had increased their home prices. In June, home prices on new construction were about 4.5% higher annually.
Many builders had stopped construction in March, originally predicting a massive slowdown when the pandemic first struck the U.S. Now they’re quickly trying to ramp up production to meet the unexpected surge in demand.
Source: “Homebuilders Just Saw the Strongest June Sales Since the Last Housing Boom, as Pandemic Pushes More Buyers to the Suburbs,” CNBC (July 13, 2020)
